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Thursday, 12 April 1973
Page: 1454

Sir JOHN CRAMER (Bennelong) - The Opposition does not propose to stand in the way of the provision of funds to the States and therefore it will not oppose the Bill. But we feel that there are many matters of importance that should be mentioned. This Bill will provide loans to the States to the value of $6,550,000 at an interest rate of 4 per cent over a period of 53 years, payable annually. The States must build or commence to build, buy or renovate by the 1st July this year. Properties acquired or built in this way will be available for leasing only and will be allocated only to approved people who are certified by the State concerned to be in need. A further provision of the Bill is that the program must not interfere with other State expenditure for housing. I think these are the principal features of the Bill.

The Bill provides for a short term, crash program. The States are to be allowed only a short period of 2i months to complete the program, and I do not know how they are going to do it. The money provided under this legislation will not mean very much to each State. I have worked out that, the loans will allow the building of about 332 to 350 homes. I have calculated that on a State basis the approximate number of homes provided will be as follows: New South Wales 175, Victoria 75, Queensland 19, South Australia 26, Western Australia 21 and Tasmania 16. So this is not a big program.

I must say that the Minister for Housing (Mr Les Johnson) is a most enthusiastic Minister and I applaud him for that enthusiasm. But I warn him that he should not put his little hot fingers too rauch into the State pies because he is likely to get them burnt if he carries On in the present way. I look upon this measure more as a propaganda stunt than of real value to deal with the problem of housing. As I see it there are several real dangers. In the first place the time factor makes it virtually impossible for any State to meet the requirements. This part of the legislation creates a sort of panic operation to build or buy, and this is not a very appropriate time to be doing either. Also, the inclusion of the interest rate at 4 per cent creates a precedent, and I do not know how the Minister arrived at this figure. It is a subsidy to the States which is difficult to maintain in other legislation. If that were done, the amount of costs could be prodigious. It is a further spur to inflation and I believe it has the tendency to increase the cost of construction and/ or the cost of purchase.

It may be of interest to the Minister to know - I say this authoritatively - that the real estate agents in Australia today are having the greatest picnic they have ever had. There are more buyers than there is property to sell. As a result, prices are going up. This is real inflation. Today prices are reaching figures that have been unheard of. Recently a very good block of land at Northbridge in Sydney was sold for the sum of $134,000.

People are realising that we are running into a period of inflation. Even though there may be a collapse in real estate at a later date - that is on the cards - they realise that their money is safer in real estate than in any other kind of investment. Therefore, all over Australia money is being put into real estate. I believe that, unfortunately, this Bill will have the effect of interfering with and jeopardising the current State programs. I like the Minister and I think that he is a great enthusiast but he. has a mania for government ownership and control of houses.

Mr Les Johnson (HUGHES, NEW SOUTH WALES) - I never knew you cared.

Sir JOHN CRAMER - That is right, 1 do not think he would deny it. He is a dedicated socialist to the nth degree and all his thinking and policy is directed to that end. He wants to build bigger and better housing commissions in each State, all controlled from Canberra. That is his idea. He does not really believe in home ownership. 1 have spoken about this for many years and have charged him with it. Now he is actually putting it into practice. He does not believe in the encouragement of little capitalists. In other words, he is a true disciple of Mr Dedman who made the famous remark that we do not want to build a nation of little capitalists. 1 suspect that, if the Minister can do it in a subtle fashion, he will destroy the building society movement in Australia. People are not aware of this yet, but it is coming. A statement was made today about credit unions. That statement will be debated later. I would like to say something about credit unions later. The Minister is already cutting down to 20 per cent the 30 per cent for home ownership that has come from government funds. His idea is to cut it down progressively further. He is creating a panic situation. He says there is a crisis in housing. 1 do not know whether he believes that or not. Apparently he does because he has said it a dozen times. His idea of a crisis in housing is based on the fact that there are about 93,000 applicants for homes from housing commissions. That is a complete and absolute fallacy, but the Minister does not seem to be aware of it. As 1 have said here before, there is no physical shortage of housing in Australia today to accommodate the population. As a matter of fact, statistically there is one house for every 3.3 people in Australia. It is interesting to note that in the last one year and 9 months - 1 took these figures out only the other day - one house was built for every 1.4 increase in population. This is not a housing crisis at all. I agree with the Minister that there is a social problem; there is not a housing problem. The social problem is that the lower income earners and the indigent people of Australia cannot pay the economic rent, and this creates a problem. It is a self-inflicted wound. I do not have time to deal with this in detail tonight, but this problem has been caused by government controls and interference in the past.

Let us look at this question of applicants for housing commission homes. Most of these people are already living in a home somewhere but they can make out quite a good case of need, on various grounds. Some are perhaps unable to meet the economic rent and others are occupying places where owners want to come into their own homes and the tenants cannot find a comparable place to rent at a rent they can afford. Families grow up and cannot be accommodated. Then there are homes that are unsuitable because of physical features and disabilities and the situation in relation to the place of work. There are quite a lot of these things that create a need so that the person in such a home wants to make an application to the housing commission for a home. These constitute the 93,000 applicants. It is very difficult to prove these things but if honourable members go into the details of them they will find that what I am saying is perfectly true.

No doubt everyone who can make out a case wants a subsidised rent from the housing commission. Once a person moves into a housing commission home, no matter how his financial position may improve, neither the Federal government nor any State government would put him out of that home to make room for somebody who could not afford to pay rent elsewhere. This is quite wrong according to the principle of subsidised rent. It is no exaggeration to say that there are tens of thousands of people in homes owned by the State housing commissions who could afford to pay an economic rent. This is a maladjustment of the occupation of homes.

Let us have a look at these housing commissions. I believe that their functions should be limited. This is not only a criticism of the present Commonwealth Labor Government because it has a different idea altogether about government ownership, but it is also a criticism of some State Liberal governments because, in my opinion, they have the wrong idea. I believe that the functions of housing commissions should be limited to building homes for low income earners in the first place because private enterprise cannot compete on that basis, and to act for governments in the slum clearance of the various cities which is necessary. They should encourage tenants to become owners of their properties. When the governments sell housing commission homes they should sell on a value basis and not on a subsidised cost basis which, in my opinion, is utterly wrong. In other words, they should not be set up in competition with enterprise builders because this creates huge areas of housing with a sameness of construction. That is not a good thing. In such cases the individuality of a home is lost. After all is said and done, a home is perhaps a once in a lifetime thing and all a person's love and affection is in that home. A person should be able to express his individuality in his home. I say that the States are to blame very largely for the way this situation has developed. They have a vested interest in building big apartments. This is now aided and abetted with government control centralised in Canberra. That is something that I do not like. There is a grave danger, as I see it, with all this enthusiasm of the Minister, of the Government over-stimulating the building industry. Already there is available to the industry, because of the action of the previous Government, a great amount of money that was poured in last year. Apart from the normal operations of Government spending, last year State works and housing programs received $9 82m. I presume that the provision of this amount is continuing under the new Government. Of that sum $24.5m was in the form of non-repayable grants to the States. In addition, a special cumulative grant of $2.75m was made. This amount is to be made available each year for 30 years and is to be used for interest and rental subsidies.

Over a period of 34 years these cumulative grants will amount to $412.5m. In addition $ 1.25m per annum has been provided to enable needy families to enjoy reduced rentals. These grants are now in operation. Over and above the amount provided by the previous Government there are special grants which are for age pensioners' homes and which are being spent all over Australia. There is also provision for other schemes for homes for the aged which are subsidised by the Federal Gov ernment. In addition, of course, provision 'g made for homes for servicemen. However, I shall not deal with that subject tonight because it is the subject of a special Bill. The building industry is fully extended at present. Anybody who knows anything about the building industry knows that. If one wants a bricklayer today, one has to beg him and pay an enormous amount. The result is that housing prices are going up and up. Inflation in this area is very difficult to control.

It is interesting to note that a Treasury paper published recently stated that private building approvals in January 1973 were 46 per cent higher than in January 1972. This indicates quite clearly what is happening in the building trade. Whilst we do not want to stand in the way of the States being given this little extra money for the good purpose of providing rental homes, if this amount is linked with the provision made for other housing schemes, including the war service homes scheme that we have yet to discuss, and the scheme about which the Minister for Housing has been having troubles with the States because he does not support home ownership, it will be found that far too much money is being pumped into the building industry with the result that the Government is creating an inflationary trend which it will not be able to control. This is not good for the price structure, the stability of our economy or for anything else. I would like to say much more on this subject, but because of the special circumstances tonight I shall leave it at that. But I warn the Minister for Housing, who is at the table, to be careful of letting his enthusiasm run away with him to a point where he does more injury than good to the people of Australia in the housing field.

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